digital payment Under GST

On 11th May, meeting of GoM on ‘Tax Insetitive’ proposal on digital payment Under GST

New Delhi. The meeting of GoM on ‘Tax Incentive’ proposal on digital payment Under GST will be held on 11th May. Bihar Deputy Chief Minister Sushil Kumar Modi will lead this panel.

In the last meeting of the GST Council, there was a proposal to give tax incentives to promote digital payment Under GST, which now the Ministerial panel will be meeting.

Proposal to promote digital payments:-

GST Council has promoted digital payment and cashless economy. The Council has proposed that if the customer pays more than 100 rupees with check or digitized mode on which the GST rate is 3% or more then they will get 2% incentive.

West Bengal has raised objection:-

Most states in the GST council meeting agreed to this but West Bengal objected to it. West Bengal believed that this would harm the poor people because they would not be able to take advantage of tax benefits because they mostly deal in cash. Meetings are being held on 11th May regarding these concerns and problems.

In case of transaction size of Rs 900 and assuming that 40% of the estimated 1,329 crore transactions were using digital payment tools, the revenue foregone would be of the order of Rs 9,500 crore a year

“While 98 per cent of the states supported the idea, West Bengal opposed to it saying the poor would suffer. We will discuss the concerns and hope to achieve a consensus in the May 11 meeting,” the official added.

The Modi-led Group of Ministers (GoM) has been tasked with submitting its report to the GST Council, chaired by Finance Minister Arun Jaitley and comprising his state counterparts, within 15 days.

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